booknook.com, 'cause it's the only place you can get this book until after the first of the year. it will make a difference. >> brian: congratulations on your success. number one in the country. >> here we go on a friday. good morning, everybody. what is general petraeus telling lawmakers about libya and is his story different from what we've been told to date? those are the questions on the line at he is testifying before two separate committees today. one is underway. i'm bill hemmer. welcome to "america's newsroom". martha: good morning, bill. i'm martha maccallum. lawmakers are hoping petraeus will set the record straight what the administration knew and when they knew it. many people are already skeptical about that. take a look. >> what is clear, this administration, including

the including thencluding administration itself. read that lied, to the american people in the aftermath of that tragedy. now president obama has the gall to float the name as possible of secretary of state the name of the person who is the actual vehicle used to misinform the american people during this crisis. bill: now we move to today. chief intelligence correspondent catherine herridge live on the hill. good morning there. what do we expect to get from general petraeus today behind closed doors now, catherine. >> reporter: thank you, bill. the former cia director arrived here on capitol hill an hour and 20 minutes ago and a source close to the general told fox news the expectation he will tell the house intelligence and senate intelligence committees he too believed it was terrorism within 20 four hours of the attack. active link to al qaeda and ansar al-sharia to wanted to

establish a islamic state in eastern libya. the source told fox news they expect the general to bring with him the original talking points put together by the cia. those talking points had input from other intelligence agencies as well as the office of the director of national intelligence and that petraeus apparently did not know they would be provided to u.n. ambassador susan rice. he does not know who the author of the final version was and these talking points would be uses as the basis for the statements on sunday talk shows on septemember 16th that this was spontaneous event and linked to the anti-islam video. lawmakers said they wanted to stay very focused on the attack itself and not the former director's personal problems. >> human nature is what it is but the intent going we'll limit the conversation to the events of 9/11 and forward throughout the rest of the, six, eight weeks ensued since the attacks on our consulate.

>> reporter: in addition to what's unfolding here on capitol hill fox news separately has confirmed the cia has begun a preliminary investigation into the former director's tenure at the cia. that would include whether any cia assets or materials if you will were used to facilitate this affair or alleged affair with his biographer, paula broadwell, bill. bill: a lot of people look at this on the outside and look at today as a day where you might be able to settle some things but in all honesty how much will be settled after today if anything at all, catherine? >> reporter: based on these two closed classified hearings yesterday and limited statements we had from lawmakers afterwards it does appear the testimony this week will really raise more questions what in fact was known about benghazi and why there was this storyline that the anti-islam video had a role. what we're seeing play out now is an attempt to mesh varying versions of events

and what are really conflicting time lines on these events. we have a state department timeline, a defense department timeline, a cia agency timeline. we have the statements thursday from the acting cia director and now today the statements from the former cia director and whether there is any common ground here based on our conversations it does seem that there are discrepancies still and it is raising more questions. bill: catherine, thank you. stand by here. we just saw peter king. he is live. >> have final talking points emerged. he said it went through a long process involving many agencies including the department of justice, the state department and no one knows yet exactly who came up with the final version of the talking points other than to say the original talking points were prepared by the cia were different from the ones finally put out. as far as general petraeus's testimony today was that from the start he had told us this was a terrorist

attack, there were other terrorists involved from the start. i told him my questions had very different recollection of that. clear impression we were given was the overwhelming amount of evidence was it was a, arose out of a spontaneous demonstration and was not a terrorist attack and pointed out the following week when matt olsen said it was terrorist attack it made headlines because until then the administration was saying it was not terrorist. it was very cordial if you will. general petraeus is an outstanding patriot. we shook hand before and afterwards. we all thanked him for his service but i think he has a different impression, the impressions he left on september 14th. >> mr. chairman, can you tell us whether or not his affair or the security issues surrounding his affair came up at all? >> only in answer to one question he was asked at the start, did that have any impact on his testimony? he said no.

>> how were the talking points different? >> the original talking points were much more specific about al qaeda involvement and yet the final ones just said indications of extremes. indicate, even though it was clearly evidence from the cia there was al qaeda involvement. >> do you have any idea -- [inaudible] >> they said it goes through a long process, interagency process that when it came back it was taken out. >> did he seem concerned things were changed? did that surprise him? >> he seemed to say at time he didn't recognize the full significance of that. this unclassified statement this was acceptable. again that is still very vague. >> was he under oath? >> no oath, given, no. >> mr. king, did he allay of your concerns? are you satisfied with the presentations he made today? >> i'm satisfied with the ultimate conclusion he reached. i told him i honestly disagreed with his recollection of what he told us on september 14th. >> mr. chairman who do you want to hear from now?

>> no comment, not at all. >> does that make it hard to get past that salacious details have dominated the news. does that make it hard to get down to brass tacks? >> no it was made clear from the start that would not be a focus of questioning. 10 seconds into it that was off to the side. >> [inaudible]. >> yeah. >> [inaudible]. >> no. you know that would all be classified, other than the fact that he now, clearly believed there was, did not arise out of a dem is stra. was not spontaneous and there was clear terrorists involvement. >> he said that straight up? >> yes. >> mr. chairman who do you still want to hear from? >> this is ongoing. still could be, obviously, secretary of state, secretary of defense. also people at the

white house. see if anyone at the white house changed the talking points. >> do you think you need to hear from him again on this and also on the broadwell situation? >> we'll have to see. one day at a time. >> [inaudible]. >> he was saying -- no, no, he was saying there are many streams of intelligence but he also stated that he thought all along he made it clear that there was significant terrorist involvement and that is not my recollection what he told us on september 14th. >> mr. chairman, how -- did he seem tired or worn out from sort of the scandals plaguing him? >> no. he was a strong soldier. he was very professional, very knowledgeable. very strong and again, spoke to him at the beginning of the hearing and at the end of the hearing, he was a solid guy. i consider him a friend which made the questioning tough to be honest with you. >> [inaudible]. >> what's that?

>> you said you consider him a friend in questioning. >> we asked questions, sometimes you hear the adrenaline is pumping going back and forth and you realize the human tragedy and you realize he is going through an awful lot. on the other hand we had obligation to find out what we could. lot easier to when you dislike the guy like when you ask us questions. >> did he give any indication how he felt after ambassador rice's testimony. >> [inaudible]. >> [inaudible]. >> no. >> [inaudible]. >> it was cia analyst with him who said that the report, talking points were drafted more specifically about al qaeda affiliations or al qaeda terrorist activities. they didn't have it in front of them. they said that was after it went through the process. whatever that process is which they seemed unclear about, that was taken out. >> [inaudible]. >> hour and a half. he spoke for about, gave

opening statement about 20 minutes. so an hour and 10 minutes of questions. >> [inaudible]. >> no. no. >> how about the cia? >> no. >> [inaudible]. >> not the dni. again it was not, i guess how you define the administration. went to the department of justice, state department and i believe national security council. >> did he talk about the films, video and what -- >> yes. >> what did he say about them? >> nothing controversyal. >> but did you guys watch any films today like what -- >> no. showed them yesterday. we saw them yesterday. >> [inaudible]. >> he didn't know. >> he didn't know? >> they were not involved. it was done, process was completed and they said, okay, go with those talking points. again, i got the impression about seven, eight, nine, different agencies. >> did he give the impression he was upset it

was taken out? >> no. >> you said the cia said okay to the revised report? >> no. they, in that after it goes through the process they okayed it to go. they said, good to go. >> who did he say, who did he say? >> i don't know. >> who did he say he thinks committed the attack then? >> i will leave it at al qaeda affiliates. >> [inaudible]. >> there's a certain amount of awkwardness, sure. all of us in the room, certainly myself and all of us have a great regard for him. i've known him for nine years now. so it's, i actually urged him to run for president a few years ago. i had dinner with him. i consider him, i know him fairly well. >> was there any discussion -- >> so, anytime you see human tragedy for a good person, tough to go through. >> was there any discussion of this national security implications of his resignation? >> no.

resignation, he addressed it at the beginning. regretted what happened and that was basically it. >> was there any talk of the night of the attack whether -- >> as far as i know it was -- >> was he involved in the actual decision making at night of the attack? >> i don't want to get into stuff -- he was definitely fully aware what was going on. >> did he ask for military backup. >> i can't get into that. >> did he say the first attack was spontaneous and the second seemed more organized, mortar attack, the second attack -- >> i can tell you the spontaneous aspect is definitely minimized right now. well just is. it was primarily a terrorist attack. >> how about, let me be careful about this. did he address how he interpreted the anti-must prelim -- muslim film and how that got to be part of the discussion? >> based on reports we were getting at the time. >> so that was part of what was going into this

intelligence product that they created? >> right. >> then they got other information later that said this wasn't? >> yes but also at the time prior to september 14th had clear information that this was strong involvement with al qaeda affiliates and that was not made part of their presentation. >> our understanding going in this -- [inaudible] >> he did but he said today that he at the time was also emphasizing the involvement of ansar al-sharia and my recollection was he was actually minimizing the role of ansar al-sharia. that's it, okay? i have to go. >> is the hearing over? >> yeah. martha: very interesting conversation with peter king who has just emerged from the hearing, the house intelligence hearing with general petraeus, with

former director of the cia petraeus. basically the headline out of this is that peter king, who said several times that he considers general petraeus to be a friend, he says that clearly in the initial interview that they did with general petraeus hedown played the aspects of ansar al-sharia or involvement of al qaeda in the attack in benghazi and that today general petraeus suggested that he had always included the fact that he felt that al qaeda was involved and also talked about the video. we'll have a let more about this. a lot emerging this morning. we'll be joined by texas republican congressman louie gohmert who is calling for a special prosecutor to investigate the benghazi attack. bill: this is something that will be discussed and debated. we're just getting going on this. more on libya and talks about the looming fiscal cliff from the white house top of the next hour. there are sipes of compromise some say? is that enough? is that true? we'll take you live there on that. martha: a horrific crash at

a veterans parade. four people dead. several more injured. >> just saw people under the train. they were like, blood, there was blood all over. >> i heard a noise. it was -- that will make it drop over, and over again. ♪ from jammin' jerk chicken, to creamy gouda bisque. see what's new from campbell's. it's amazing what soup can do.

>> we are off and running on this benghazi story. it is the biggest story of the day, testifying before congress at the moment. first the house side and then the senate side as general david petraeus is there. house homeland security chairman peter king just missed talking about this. if you missed it moments ago here is part of what he said. >> the testimony today was from the start he had told us this was a terrorist attack, there were terrorists involved from the start. i told him my had a very different recollection of that. the very clear impression we were given the overwhelming amount of evidence it arose out of a spontaneous demonstration and was not a terrorist attack. bill: this is perhaps the most significant testimony

to date. republican congressman louie dpom mother of texas, member of the house judiciary committee. what peter king said but you were not in that hearing. however what you are doing is calling for a special prosecutor on benghazi. how come? >> well, bill, for a number of reasons but one of them is that special-ops groups, retired individuals who had served this country, put their lives at risk, have come forward and said, look, we need answers and we need to know the truth. they have got over 100,000 people that have signed a petition asking for a special prosecutor. and from what pete king said it is even more important that we have a special prosecutor. we know the council statute lapsed in 1999. there is inherent power under the constitution, the executive branch appoint a special prosecutor to investigate when there is any type of conflict of interest. there is all kinds of

conflicts of interests. you remember that bill, that commercial ran against president obama in the primary, who do you want answering the phone at 3:00 a.m.? turns out the answer is for heavens sakes, somebody answer the phone. these guys who put themselves in harm's way, in our defense, the guys did it on behalf of the ambassador himself, people that may enlist in the service, foreign service, military service, they deserve to have answers --. bill: if i could, then. we're a little condensed on time because of the peter king press conference. >> you bet he is. bill: but you would need the president to initiate this? that is the first point that has to happen -- >> be appointed by the ag, so eric holder who would do this then? >> that's right. bill: would you expect him to do that, a? and b, how would that contribute to the process of understanding? >> it has to be an independent prosecutor that does the investigation.

fallback position is a select committee but it is clear, only the executive branch has the authority to prosecute in the event of a crime. you as you have a better investigation if someone who has prosecutorial authority does the investigation. that is why it is so important. bill: i understand but in a word do you expect it to happen or not? >> if enough people rise up as people are starting to, including these 100,000 military individuals, they rise up and call for it, you bet. i expect it to happen because he doesn't want a blowout election in 2010. and people serving him deserve this. i think if people rise up they will have to do it. bill: we've got to run. thank you, sir. louie gohmert. thank you for your time. martha. martha: we'll have a lot more on this morning in "america's newsroom." also this. air raid sirens ringing out in the middle east. now thousands of israeli reservists are said to be ready to move. we've got a live report on that coming up. bill: also a freight train

crashing into a parade float during an event that honored wounded war heroes. a horrific story here. that's up next

martha: investigators are examining the scene of a horrific train crash that happened in midland, texas. a union pacific freight train slammed into a parade float that was carrying wounded u.s. military servicemembers and their families. it was said to be on its way to a banquet honoring the veterans on thursday afternoon. at least four people were killed, more than a dozen injured. >> very heart breaking. they didn't die out in the feed and came out and something had to happen to them here. >> my brother is in the marines. so it is just, really

devastating what happened. thoughts and prayers are with the family. martha: awful, awful accident. casey stiegel is live in midland. so, casey, what's the latest on this. >> reporter: martha, it is a very active scene right behind me this morning and i will hop out of the scene to let you see investigators at work. investigators with the ntsb, national transportation safety board back there. more are on the way. of course everyone this morning trying to figure out how the heck this happened. the parade float was carrying 26 people total. 12 veterans, 12 of their spouses and two civilian escorts t was heading to a hunt for heroes banquet when it went through a railroad crossing. the train reportedly sounded its horn as dozens of on lookers watched in horror and then chaos. >> it's a sad day. i was with these guys today. we had a unch. some of you were with us.

we were able to meet the heroes. i shook their hands, saw them personally. i met their wives. it was truly an honor to be in their presence these guys are true american heroes. >> reporter: one is still critical this morning a spokesperson with union pacific railroad says the crossing gate and the lights were functional at this crossing. but some eyewitnesses, martha, say the gate was not operational. martha: was the gate down, casey, at the time? >> reporter: that's what is really unclear right now. you know how sometimes the gates go down, we've all been at intersections and they get stuck and there is a way you can maneuver around it. we do not know if that is what happened in this case. what we know there was another float, another parade float ahead of this one that safely cleared the crossing. then as the second one tried to do so, the collision, once the horn sounded. there were reports of some

people jumping off of the float as if they had some kind of a heads up. some made it out of the way just in time. an interesting side note here. out of the approximately 140,000 public railroad crossings in this country, martha, only about 52% of them have active warning, active warning functions. martha: yeah. casey, sad story. thank you very much. bill: yeah. from the middle east now, there are air raid sirens yet again today in the heart of israel. thousands of army reservists have been mobilized in that country. and there are signs that the middle east may be on the brink of yet another war. we will take you there live and talk to ambassador dan gillerman for the latest. martha: there are high-stakes this morning in talks at the white house. are leaders ready to bargain over taxes? what to expect behind closed doors and hopes of possibly avoiding a plunge through the fiscal cliff and into recession.

>> when it comes to the top 2%, what i'm not going to do is to extend further a tax cut for folks who don't need it which would cost close to a trillion dollars and its's very difficult to see how you make up that trillion dollars, if we're serious about deficit reduction by just closing loopholes and deductions. says it mahelp lower cholesterol, how does it work? you just he to eat it as part of your heart healthy diet. step 1. eat the soup. all those veggies and beans, that's what may help lower your cholesterol and -- well that's easy [ male announcer ] progresso. you gotta taste this soup. that's what may help lower your cholesterol and -- well that's easy seems they haven't been moving much lately.

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want to take you now to the middle east. this is live look over the buildings in gaza city. hundreds of rockets have been fired back and forth between israel and militants inside the gaza strip. this has been going on for days. there is some new video from overnight we want to share with you. the idf, israeli defense force, showing airstrikes taking out launch sites inside of gaza. this has been heating up throughout the day. leland vittert is on it. he is live near the israeli-gaza border where the military has been mobilized. there is a lot of talk about a ground invasion. are we close to that happening again in the gaza strip? >> reporter: certainly seems that way, bill, in the sense we saw a number of rockets go off from gaza launching here into israel. so clearly these three days of punishing airstrikes have not yet diminished hamas's ability to launch rockets towards israel. now israel is thinking it

may have to go in on the ground. we were driving around where the idf had dozens if not hundreds of personal care yors and bulldozers and tanks, that were concealed pretty well behind a large berm and trees out of the line of sight from palestinians where they can use laser-guided anti-tank weapons. the israelis called up some 15,000 reservist forces activity duty guys from both sides of the border to mass here on the gaza border to go in if the order it given. bill: leland you have much different middle east from the last time when there was a ground invasion in gaza and there is significant concern how the current egyptian government is giving support for what hamas is doing now. how is that now factored into this equation as israel tries to make divisions to defend its people and its country? >> reporter: it is a totally different ball game because four years ago when israel

went into gaza, hosni mubarak who was in egypt squarely on the side of israel and united states putting pressure on hamas. that is not the case now. as hamas is launching rockets into israel they're not hearing anything from egypt. all they're hear something support from egypt and condemnation from israel. the thing that israel has is the iron dome defense missile system is defending from some missiles but certainly not all. they're saying only thing that which bring sees fire if hamas stops firing. they don't seem interested to do that and there is no pressure from egypt to do that as well. bill? bill: leland vittert on the border between israel and gaza city. we'll talk with ambassador dan gillerman live in tel aviv. that is coming up in 10 minutes. martha: back here at home and the issue of the fiscal cliff as president obama meets with congressional leaders at the white house today. been a busy week for meetings at the white house.

they will discuss a compromise perhaps to stop the so-called fiscal cliff. there is new reports out there, signs some willingness to compromise perhaps on the issue of raising taxes but here is sort of where both parties have stood in recent days. >> there are ways to put revenue on the table without increasing tax rates. we talked about this now for over a year. >> we can not afford to extend the bush tax cuts for the wealthy. what we can do is make sure that middle class taxes don't go up. martha: all right. that's where it has been for some time between those two sides. if this is not resolved, 158 million americans will be affected in terms of their taxes going up. of average households will pay $3500 in additional tax, a huge chunk of their income. some 88% of households will see their taxes go up if no deal is reached. let's bring in the great panel this morning, marjorie

clifton the principle at clifton consulting. mary katharine ham, editor-at-large for hotair.com and fox news contributor. welcome to you both. >> good morning. >> first question to you, mary katherine. nancy pelosi suggested maybe there is a bit of wiggle room in the $250,000 amount. maybe we could move it higher who is considered rich in this country. is that something though that you think john boehner is even interested in? >> i think it is probably something that he might consider. this is how negotiations work. congressional "fight club." they stake out their positions and sort of move closer together as they come together and actually meet and discuss this. there are couple options what they can do on the table. president signaled perhaps it doesn't have to be all about getting rates to clinton era levels. perhaps getting revenue from other places. i think that would be healthier, broader tax reform kind of deal made. i'm not sure whether they're all savvy enough to make that deal.

i mean. martha: seems to me that is the major issue here. that is what john boehner was hinting at. he is suggesting that if you remove some of the loopholes that is a tax increase on the wealthy in this country. i feel like that is a message that has gotten across in perhaps a clear enough way. if you do same thing for u.s. corporations and roof move tax loopholes and don't end up in a situation where ge doesn't pay anything and small business pays through the nose. why isn't that kind of reform meaningful for democrats? >> i think there is a general understanding of two things. we'll have to increase tax rates. this is across the board and we'll have to find ways to cut the fat in a lot of these government programs. as we know the devil is in the details. we're looking very different congress, not wildly different but moderately different we don't have a lot of tea party republicans before that were creating a stopgap in some of the negotiations. on democratic side we're starting to see president obama saying things like we're willing to compromise on the amounts.

i think the key thing is, democrats are seeing the election of president obama as a willingness of the public to say, we want to raise taxes on the wealthy and again, what is the exact magic number? we don't know. none of have a crystal ball --. martha: but here is the issue. wouldn't people rather, wouldn't people rather see wealthy people pay more something that changes the system going forward in terms of efficient of real tax reform than by slapping a bandaid on the top by rich people paying more and spending problem that bubbles and boils out of control and leaves us with a debt we have now? mary katherine. >> that is my point of view. i think you can make a healthier system where things are truly fairer not by making people you don't like paying more. negotiate the system and in a way that makes sense is more same. for perspective, $110 billion to defense discretionary spending would

happen for perspective, $110 billion is freaking out, the october deficit we ran for one month, $120 billion. these tax hikes, 24 billion to a trillion dollars, this year's deficit, $1.2 trillion possibly. that is what we're looking at. these are small solutions and we're freaking out over that. >> the cuts are really important part. what we saw this morning "usa today" and "gallup poll" released a study that said 88% of americans want social security and medicare to be upheld. but one of the things democrats will have to understand is, there is fat to be cut in those two programs as well as in defense. martha: what about increasing age for eligibility? >> absolutely. martha: means testing? >> absolutely. i think the government could use a healthy haircut in all of our programs. we need to lose some weight especially in defense. that is where republicans will have to spend. >> more about fat. martha: sounds like you guys have the whole thing pretty much solved. >> we solved it all in the

makeup chair. martha: we seem to understand what needs to be done. >> that's why we need more women. martha: thanks to you all. bye-bye. bill: when you were talking there we were watching some more video now. this is new video in from gaza. we've been watching activity in the distance there. plumes of smoke going up in the air. we can not tell precisely what this is at the moment. hamas and israel are on the brink of war. already today more rockets launched into israel. the former israeli ambassador to the u.n. is dan gillerman. he is live in tel aviv where some of the rockets are aimed again. again air raid sirens are screaming. we will talk to him after this patients will try and deal with it by drinking water. water will work for a few seconds but if you're not drinking it, it's going to get dry again. i recommend biotene. all the biotene products like the oral rinse...the sprays have enzymes in them. the whole formulation just works very well. it leaves the mouth feeling fresh.

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martha: well early this morning general petraeus made it into the capitol hill buildings virtually undetected by the press. went in through an entrance where he was not seen. he is now on the senate side talking to the intelligence committee over there. peter king we heard from when he came out of the house intelligence meeting

earlier this morning. here's what he said. >> no, he was, there are many streams of intelligence but he also stated that he thought all along he made it clear that there was significant terrorist involvement and that is not my recollection of what he told us on september 14th. martha: that is a big sticking point and a lot of talk about the talking points and how they were apparently, according to these reports, changed and evolved beyond the point where general petraeus says he knew what was in them when susan rice went before five talk shows on that sunday afternoon, that sunday morning. we'll see where it goes. bill: petraeus is pretty good spy after all. got into the capitol without a single reporter seeing him. that's not easy. middle east on the brink. air raid sirens heard again today in tel aviv, israel. [sirens] it was a morning of heavy rocket fire from gaza aimed into the israel. ambassador dan gillerman is

in tel aviv now. he is the former israeli ambassador to the u.n. he is with me now. there is a bit of delay on this signal. be patient with us. mr. ambassador, here is the question. will israel start a ground invasion of gaza? >> well, bill, israel started this in order to finish it. it started it because the situation became unbearable and the prime minister decided that enough was enough. no other country in the world, certainly not the united states, would stand for one minute for what israel has taken over the last few years. over a million of its people are under threat and under rocket attack and children sleep in air raid shelters and can not go to school. so israel is going to finish the job. we have an evil, brutal enemy in gaza. hamas is nothing but a

bloody proxy of iran which intent on destroying israel. and we will not just put it to sleep so it can wake up again and raise its ugly head and continue this devastation of israeli cities and villages and schools and kinder gartens. we will finish the job. if it takes ground troops, if it takes an all-out war we will make sure that hamas will never again be in a position to disrupt and destroy, literally destroy israeli lives. bill: based on that answer, sir, i take your answer to be a yes to my question, is that right? >> well, i can not tell you what the exact plans of the military are. obviously they're kept very secret and decided according to developments on the ground. all i'm saying is, that we will not allow this evil snake to keep raising its head and biting us. you have to understand what

is happening here, bill. i mean they are intent on killing as many israelis, women, children, and babies, innocent people, as possible. and even in this operation now, you can see the distinction between us. we are being very cautious, very surgical, very accurate while they are actually aiming rockets at our cities including tel aviv but many, many cities in the south. in fact, while for us every dead palestinian child is a tragedy and a mistake, every dead israeli child is success and call for celebration and we have to stop it. bill: i'm reading off the associated press urgent wire that israel is calling up 16,000 reservists ahead of possible gaza invasion. i'm hearing by reuters, air raid sirens sounding in jerusalem at the moment. we'll see what comes of that. the circumstances in that

region of the world are very different than they were even two years ago. the egyptian government is apparently offering support of hamas during this current conflict. how significant is that and how does that change the dynamic for the possibility of war yet again with israel and hamas? >> well, bill, we live in a very tough neighborhood. we're in fact a villa in the jungle and this junk billion is becoming more violent and more ugly every day. you can see how assad is butchering over 30,000 innocent syrian civilians. the muslim brotherhood has taken over in egypt and ruling it in a way that the young people in tahrir square did not aspire to. the visit today of the egyptian prime minister to hamas was very symbolic are move. hamas kept firing hundreds of rockets while he was there while we kept him safe. let me tell you something

from experience and my time at the u.n. make no mistake, egyptians and other arab countries have very little love lost for the palestinians. they do not love them. they do not sympathize with them. they use them as an alibi and tool in their internal fights. believe me if i told you the number of arab kings, sut tans, emirs and presidents who came to me during the last time we went into gaza, go, finish the job, don't stop. and they were yearning for us to finish them off. in a way i'm not sure this is not the case now. don't believe everything the egyptian president says publicly. listen to him privately and you will get a totally different picture. bill: mr. ambassador, thank you for your time. one of your many hats will be a fox news contributor. we'll lean on you heavily to get a better understanding from the israeli perspective. the associated press reporting air raid sirens wailing in jerusalem. we'll see what comes of this. martha. martha: this is the ranking

member of the house intel committee. he heard from general petraeus earlier do. we will play his comments for you, his reaction to general petraeus on the hill this morning right after this in "america's newsroom." stay with us. i always wait until the last minute. can i still ship a gift in time r christmas? yeah, sure you can. great. where's your gift? uh... whew. [ male announcer ] break from the holiday stress. ship fedex express by december 22nd for christmas delivery. humans -- even when we cross our t's and dot our i's, we still run into problems. namely, other humans. which is why, at liberty mutual insurance, auto policies come with new car replacement and accident forgiveness if you qualify.

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martha: fresh off the petraeus hearings, the ranking member of the house intel committee, congressman dutch ruppersberger from maryland, these are the comments he made about what was said in the closed hearing. let's listen. >> whether it is or isn't now the fact is that he clarified it and it goes to show when you try to get information out very quickly and because of congress wanting to hear about it the administration and media the information with respect to intelligence evolves and changes.

as soon as they receive additional information they clarified it. >> within the first 24 hours did the cia believe it was a terrorist rift attack? >> yes. clearly that was said at all times. because of people involved in the group were affiliates of al qaeda and other extremist groups. >> description, this that it was a terrorist attack in the first 24 hours. was that information communicated and doesn't that contradict the idea of spontaneous demonstration? >> well, i think if you look at the facts and what we learned yesterday as far as the film is concerned the first incident was a lot different than the second incident in the annex that is what the difference. when you look and see what was there, you had individuals coming into the compound who were looting. there was a lot, there was no command-and-control evaluating where we're going to go, how we're going to go but there were also people attacking and putting buildings on fire but the second incident, that was entirely different.

that was well-organized. seemed to be command-and-control and people who had experience in attacking and are al qaeda and other extremists knew what they were doing. they knew how to shoot mortars and head targets. so there were two different types of situation, the first and the second. that is probably where the opportunistic issue comes to play. martha: all right. you so you hear that, dutch ruppersberger basically delineating between the initial hit on the embassy, on the consulate i should say and then the second hit which he says was much more organized on the cia annex. they have just listened to testimony from general petraeus about what knows about that night. one of the big issues here are the talking points that were circulated, that led to the appearances on sunday by susan rice. the cia, former cia director saying they were not as he saw them, when they were turned around and interpreted by the white house and by susan rice. we'll have a lot more coming up on that moments away.

bill: you have libya. you have israel. you have the ongoing petraeus matter we have talked about and you have the congressional leadership in the house and the senate, republicans and democrats, about to sit down face-to-face at white house. we'll have that for you when we continue.

martha: important meeting number three of the week at the white house about to get underway there. today's guests are the leaders of congress. president will sit down with them to talk the issue of fiscal cliff. we'll see how that works out. joining the president, senate majority leader harry reid, house speaker joan boehner, house minority leader, nancy pelosi, and senate minority leader mitch mcconnell. so the goal is to hammer out a deal or to begin the framework of hammering out a deal before series of automatic spending cuts and tax increases kick in the first of the year. some really do fear that could trigger yet another recession which nobody wants to see in this country. so that's how we welcome you to a brand new hour of "america's newsroom." happy

friday, everybody, i'm martha maccallum. bill: how are you feeling? martha: great. bill: long week. martha: busy week. bill: i'm bill hemmer. good morning again. we have six weeks to go before you get a deal. one of the main sticking points remains whether other not you extend the current tax rates for all americans or you go for major tax reform that would help eliminate some of the current tax writeoffs. this is the speaker on the floor of the house. >> we're going to further weakening the economy by raising tax rates and hurting jobs. look, this shouldn't be that difficult. >> let us go to the table of good faith that we want something to happen because i do think that if nothing happens, the consequences could be great. martha: go to the table with the best intentions and we'll see what happens? peter doocy is live at the white house with more on this big meeting. peter how much progress are these leaders expected to make today? >> reporter: hard to say, martha. this is the first time this powerful bipartisan group

has gotten together since the election. they're obviously here on the president's home turf and the president has made clear that he thinks his big win last week amounts to a mandate to help the middle class. he wants to help avoid, he wants to avoid the fiscal cliff without putting a burden on the middle class the latest from the press secretary here at the white house, jay carney, that quote, it is simply unacceptable to go back to policies that failed, that stucked middle class with the bill in order to give very expensive tax cuts to the very wealthiest in our country. we can't afford it, and the president will not sign under any circumstances any extension of tax cuts for the top 2% of americans earners. we learned this morning about former 100 obama campaign staffers needed a new job launched a grassroots effort aimed at getting republican lawmakers to cave and agree to higher tax rates in any kind of potential deal. "washington post" says that they're going to do that by protesting outside republican lawmakers offices and calling their

constituents. martha? martha: that is going to be very interesting. so the big question is whether or not republicans will agree to any higher taxes. john boehner has said basically that he has dug in on that. he wants tax reform, not higher taxes. >> reporter: and the president is expected to come to the table today and say over the next decade he wants to raise $1.6 trillion through higher taxes. but the republicans including the speaker have so far been very firm in saying they would rather raise new revenue closing loopholes and eliminating deductions. >> we talked about this now for over a year. you could, there is all kinds of information and data out there but, getting into the specifics of that at this point would not be conducive to trying to come to an agreement with the white house. >> reporter: and, martha, the vice president is just pulling up to the white house. you can hear the motorcade in the background. so this meeting is about to get underway.

bob corker, republican senator from tennessee who will not be here today but will obviously have to vote on an evental deal at some point, if today's meeting just amounts to a photo-op that is really depressing. we should know by lunchtime if any kind of progress was made. back to you. martha: peter, thank you very much. we'll see. bill: so you've got that happening at the white house. the action on the hill is this and the big story there. lawmakers are having hearings today with general david pet the petraeus. a house hering apwrapped up. a senate hearing is underway. giving us a new glimpse what happened during the attacks in libya. these are not public hearings. we have this a short time ago from some of the house republicans that were in that hearing. let's listen. >> the additional information we got, susan rice said, what did it say? basically they thought it was event happening in the film. later on, found out that wasn't the case.

changed the situation. said that was not the case. other issue as far as susan rice is concerned, she went before, with the administration, made comments but, i don't know how much further i can go with susan rice. i didn't talk to susan rice. all i know what she said. i know she received a lot of the same information that we did. >> they now clearly believed there was, did not arise out of a demonstration. was not spontaneous and it was clear terrorist involvement. bill: okay. there's your backdrop. catherine herridge is there live on the hill today watching this and listening. a lot of times you try to read between the times what they're telling us and what information they got from general petraeus. what else we learning from this first hearing today? how is the story at the moment changing, if it is? >> reporter: thank you very much, bill and good morning. just to lay out what we know about that classified session before the house intelligence committee this morning, the former cia director began with a

20-minute opening statement. it was relatively broad. it did touch on this affair with paula broadwell, something he said very much regretted. in addition he told the committee members that these talking points that were put together by the cia ultimately, they do not know who was responsible for that final version that was given to ambassador susan rice. and this is significant. this pushes the focus over to the administration and the white house as to whether that intelligence, intelligence assessment was somehow massaged because what we're told from this morning that it did look different than the initial assessment. number three, is the issue of what the general told congress that first week after the attack. september 14th, several lawmakers have told fox that the general seemed very much wedded to the administration's explanation that it was an anti-islam video, though today he said he believed it was terrorism from the first day.

>> no. there were many streams of intelligence but he also stated that he thought all along he made it clear that there was significant terrorist involvement. and is not my recollection of what he told us on september 14th. >> reporter: so the most important data point from this morning is that according to the former cia director he believed within the first 24 hours, that the benghazi attack was an act of terrorism, and when you strep away all the discussions of the time lines, what is also clear that it took the obama white house more than a week to publicly say that it was terrorism. so you do have this discrepancy. the cia director saying it was terrorism, really right out of the gate but the white house having this lag of eight days, bill. bill: a specific question here. answer it as best as you can. what do we believe general petraeus thought that

anti-muslim film contributed specifically now to what was happening in benghazi? do we know officially yet how he believes the film either played a part or did not play a part? >> we don't know from the readout from lawmakers outside of that hearing this morning but, i would pay particularly attention to what we just heard from the ranking member. several lawmakers have now described how the first attack seemed more disjointed. not very coordinated as these militants overran the consulate. and the second attack on the cia annex seemed to have much more command-and-control. it was far more organized. it had the use of mortars. mortars are an indicator of premeditation. there may well be confusion that the first attack seemed somewhat spontaneous if you will but the second was clearly premeditated and very definitely the act of an a terrorist group, bill.

bill: thank you, catherine herridge live there. we'll see what the senators say when they talk and go before microphones. if that happens, it should take place this hour. catherine herridge thank you on the hill. martha. martha: meantime some shocking developments concerning the u.s. postal service. the agency announcing a record net loss of nearly $16 billion. that is for the fiscal year that ended on september the 30th. that is more than triple its losses from last year. how do you do that? and adding to this crisis the agency just reached its $15 billion borrowing limit from the treasury department but the senate gave the postal service a lifeline back in april, passing a bill providing incentives to retire about 100,000 of their employees, and allowing the agency to recoup nearly 11 billion that it overpaid to employee pension fund. still leaves them if you do the math in a very deep fiscal hole.

bill: new report on the federal hoisting administration, the fha, showing projected loss of more than $16 billion through the end of september. that is much larger figure than the earlier for cast. a report suggests that taxpayers could be on the hook for all of it. first time in the mortgage insurance giant 78-year history. housing officials says the report does not include $11 billion in expected revenue together with other steps would restore agency reserves by end of the next year. we can only hope, huh? martha: we're looking at something coming in from chad pergram we'll bring you in a moment. all eyes are clearly on washington where congressional leaders and sit down on the first fiscal summit. you had labor leaders then the ceos and now members of congress convening at white house. how important is it they figure out some way to keep us from going over the fiscal cliff. we'll talk to one of

president reagan's former economic advisors to see what he thinks about that. bill: a house race taking a ugly turn. one of the candidates is going to court today. we'll fish that out for you. martha: former cia director david petraeus taking questions first time about the deadly attack in libya. we know he is in the senate intel hearing as we speak. as we wait for senators to come out we'll hear what they have to say about it. here is congressman joe heck on "hannity" last night. we'll speak with him next. >> i think the only person who can answer that question is the president. we need to know what he knew and when he knew it as far as how this incident evolved. we owe it to the american public and we certainly owe it to the family of the four who were lost meet beef. it's swanson flavor boost. concentrated broth to add delicious flavor to your skillet dish in just one stir. mmm! [ female announcer ] cook, meet compliments. get recipes at flavorboost.com.

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the stakes could not be higher, frankly. if they do not strike a deal, about $600 billion in tax increases and deep spending cuts kick in at the end of december which could affect every american in this country. art laugher, former economic advisor to president ronald reagan with me today. art, good morning to you and welcome back. >> how are you, bill? bill: doing fine. thank you for your time. i look at some issues share with producers today. you say this is really serious and you underscore that. everybody considers it serious. you worked at the white house. you were in on these meetings. is this a forum for negotiation or is this -- what happens? >> it is a little talking to. they will both come in with their sides, their positions. there will be some sort of testing of the waters. we will see how responses are afterwards. we'll see aggressive play. then you will see which side starts giving in. we'll be following that in the next couple weeks. but obama has made it very clear, he believes he has a

mandate but he really doesn't. he only got barely over 50% of the vote. reagan got 59% of the vote in his second term. the nixon won everything except massachusetts. so this is by no means a mandate. republicans still control the house. bill: let me be a little more specific on my question. are these negotiations taking place or are they sharing ideas? is this a photo-op frankly? >> well, i think there is a lot of photo on as well. a lot of posturing. the negotiations don't take place in these meetings to be honest with you. they take place among staffers. with signals going back and forth, the indirect way of negotiation is way it is really done. it is not done in a grand meeting where they actually start new ideas. that is a photo-op. that is position to get together and --. bill: reading article this morning in "the wall street journal", talking about many states getting ready to set aside money and looking for perhaps to cut in the event that, we reach the cliff and we go down over it. what is your expectation that happens here?

>> well, i think we already reached the cliff. the real problem is, bill, people accelerated income out of 2013, into 2012. so that way overstates 2012's growth rate and gdp. that will be reversed just like it was in 2010, 2011. even if they reach an accord. i had think you will see very bad 2013 economy. if they don't reach an accord. if they raise those highest rates you will see secular growth in the u.s. as well which will be a double-whammy. it will be unpleasant ugly year in 2013 if obama gets his way. bill: what he said the other day he is open to compromise. is your expectation compromise or is your expectation the tax rates increase? >> well i think the tax rates are going to increase. i don't think he is going to compromise on that. boy, i hope he does because it really would be harmful for the country. if he wants to broaden the base --. bill: does john boehner have votes in the house to get

approval for that? >> i think john boehner has a lot of power in the house. i think he is very fine leader of the house. john boehner is pulled by two groups. one he does not want to be obstructionist not to allow tax cuts for lower group to go through and doesn't want tax cuts to go through. he is pulled on that side and by his own party. what i hope is that the vast majority of the republicans hold true and if some of the republicans peel off, i would, that would be fine. if they pushed through obama's bill, but i do not want to see them punished. but the republicans need to have this position for 2014 and the rest of 2013 when the economy goes in the garbage dump. republicans are right. bill: two more quick questions on this. >> sure. bill: when these congressional leaders speak, what sort of code words should we be listening for today? >> well i don't know what they would say to each other but on the outside, using the word rates left revenues

and that type of stuff are code words especially coming from the president. if he talks about raising revenues and does not insist on it being rates there is a good compromise possible. if he forces it to be rates i think there is not a lot of compromise and republicans will have to concede or take it over the cliff. bill: i've -- >> i don't know how they would do it. bill: are you buying for this uncertainty or running for the hills? >> i have run for the hills. personally i have done a lot of protection. yes, i have done did that. how did you know that was kentucky talk of me? bill: wild guess. >> i love it, bill. bill: speak to you again. thank you, art. >> thanks, bill. martha: we've got breaking news from our producers in jerusalem. there have been two rockets that just landed outside of the city. no apparent damage or reports of injuries there but this is clearly an escalating situation to some degree as israeli troops and tanks are now massing at the border of gaza. it signals that a ground

invasion is a clear possibility in this situation and it comes as egypt's president says that he will not leave gaza on his own, on its own in the battle with israel. could all of this be leading to something bigger. we'll be right back. i'm a conservative investor.

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martha: all right. we are back. it is the news that junk food lovers never wanted to hear, folks. hostess, the maker of twinge kings and ding dongs, how good are they, going out of business. the company blaming a workers strike for crippling their ability to make and deliver their products. adam shapiro from the fox business network joins us now. adam, that was part of my

three food groups in the lunch box, twinkie, apple, peanut butter and jelly. i don't know how i would have made it through grade school. are they gone for good? >> reporter: old peanuts cartoons sponsored by dolly madison. wonder bread. this is whole bunch of products nationwide really about as american as apple pie so to speak. look, hostess, is asking the bankruptcy court for permission to liquidate. what that means, twinkies, ding dongs, dolly madison, most likely will be sold to a potential buyer at pennies on the dollar and that these products will eventually come back to market. the quote though, what happens to all those people, 18,500 to will be unemployed? gregory rayburn, who is the ceo was on fox business yesterday and he was saying look, this boils down to the fact we've been in bankruptcy because we can't afford the health care plan as well as the pension obligations. they had agreement from some of the unions to go back to work and they accepted the

offer that was before them in order to keep the company afloat but it was bakers union said absolutely not. the bakers confession shun airy and tobacco workers and millers union would not compromise. now that company is going to liquidate. martha: came down to the bakers the people who actually made the little tasty treats, they're the ones that blew the deal? >> pretty much. here is what rayburn says will happen to the employees potentially now that they're liquidating in his own words? >> do i hope brands will survive and someone will take those? certainly i will do. that will not help the people in our plants. our industry is overcapacity. they will not come buy the plants. even if they did they will not offer a better contract. a lot are nonunion anyway. >> reporter: forced the sale of these plants. they put their members out of work. whoever buys them won't necessarily need to put them back to work because they will probably have bakers

already and won't need the extra staff. martha: boy, what a shame. what a shame. adam, thank you very much. adam shapiro. bill: labor dispute puts 18,000 jobs on the line at a time when the unemployment rate is ridiculous. martha: due to the union. bill: saw what happened with the weekly jobless number yesterday. it shot through the roof. martha: will be higher next month thanks to that. bill: david petraeus is testifying at the moment in front of a senate intelligence committee behind closed doors, answering questions what happened in libya. we expect some of those senators to come before a microphone as house members did last hour. when that happens we'll bring it to you. martha: this is the other huge story right now. israel, calling up 16,000 reserve troops ahead of a possible ground invasion of the gaza strip. this after three civilians are killed in a direct hit on their apartment building. we'll be right back. 4g lte is the fastest.

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attack. was it a different story that you heard today? >> well i think, first director petraeus went over what he told us back on the 14th and i compared that to the notes that i had taken during that hearing and it was very similar. what he did today was tell us where, through the process ofee value waiting on going intelligence the story changed. what was initially presented on the 14th over the dores o course of the intervening weeks and months did change. he said this attack was perpetrated by extremist groups. certainly there was information of what groups may have been considered to be involved, however, that was classified at the time and not put out to the public. then he walked us through the process and here is where we realized our initial assessment was off on this point. martha: i have to jump in for one second. we are having a play back coming from the white house and president obama, we want to play that, we'll get back to the

congressman. >> i want to welcome the congressional leadership here and thank them for their time. i think we are all aware that we have some urgent business to do. we've got to make sure that taxes don't go up on middle class families, that our economy remains strong, that we're creating jobs, and that's an agenda that democrats and republicans and independents, people all across the country share. so, our challenge is to make sure that, you know, we are able to cooperate together, work together, find some common ground, make some tough compromises, build some consensus to do the people's business. and what folks are looking for, and i think all of us agree on this is action. they want to see that we are focused on them, not focused on our politics here in washington. so, my hope is is that this is going to be the beginning of a

fruitful process, where we're able to get to an agreement that will reduce our deficit in a balanced way, that we will deal with some of these long-term impediments to growth and we are also going to be focusing on making sure that middle class families are able to get ahead. i want to thank all the leadership for coming, and with that, we're going to get to work. thank you very much, everybody. appreciate it. oh, wait, wait, excuse me, there is actually one other point that i wanted to make, and that is that my understanding is tomorrow is speaker john boehner's birthday. for those of you who want to wish him happy birthday, we are not going to embarrass him with a cake because we didn't know how many candles were needed,. >> yeah, right. >> but we do want too wish him a happy birth day. >> thank you, thank you. >> thank you everybody. martha: the birthday produced a handshake there.

that's a start as they get some kind of negotiations and talks going there at the white house with the senior leadership and president obama. so we will continue to cover that story of course we'll see if anything comes out of it once they walk out of there and we may get some feedback from some of the players in that meeting. for the time being i do want to get back to joe heck, a republican congressman from deaf who was part of the testimony from general petraeus this morning. i want to go to this i shall you've the talking points, because when susan rice went on five sunday shows and claimed that it was a spontaneous attack, that there was no preplanned and organized attack that morning, it was basically suggested to the american public that that was based on intel reports. what did general petraeus say in terms of his understanding of what they were putting out there towards the white house, in terms of their take on everything? >> certainly the cia and the intelligence community put together a talking point paper, that once it left the building

of the cia went through a process of inner agency coordination and ultimately ended up bee believe in ambassador rice's hands to use as a briefing fool for her appearances. we still don't know who pwraoefz ambassador rice, what talking points she used and who edited them from the time they left intelligence community to the time she made her aeu americans on the sunday morning talk shows. neither director petraeus nor any of the witnesses we had yesterday in the benghazi hearing were able to answer that question kwrao did he specifically say that the talking points that they prepared had references to al-qaida and shar sharia law shar an al sharia? >> they initially did state that al-qaida affiliated groups were involved. however, by the time we understand that went through its editing process after it left language lee that reference was taken out.

martha: was it your impression this morning as you listen to general petraeus that there was anything that he really wanted to make sure came from him and that he wanted to make clear was different from what we've heard from the white house and susan rice, or from the first testimony? >> well, the thing that is clear and that he emphasized was that the initial intelligence reporting which stated that the incident grew out of a spontaneous demonstration or protest was proven to be false. there was no protest outside of the gates prior to the attack starting and that became apparent after the interviews of individuals that were at the compound and the viewing of the surveillance tape of the embassy outpost. martha: interesting. good to have you with us this morning. >> thank you, martha. bill: that is one of our big stories today. the other one is what is happening in the middle east as we watch this. i want to bring in kt mcmarch land our international analyst. good morning to you.

>> good morning. bill: i don't see you yet. i see you now. kt here is what i want to do, i'll take you through a series of maps so you can explain the potential for a ground war with israel and what is happening in gaza strip a. all this relates now to what's changed in egypt and hreub why over the past two years. here is gaza, roughly 18, 20 miles long, maybe a mile or two wide at the crossing here. and this is raffa, the town of raffa in egypt goes into gaza. when is important about that time is that is where the weapons come from. what what do we need to understand about this geography before we go to this map. >> the missiles that are coming from gaza are reaching as far as tel-aviv the -- tel-aviv the largest city of israel and in fact could potentially reach jerusalem. the palestinians started this. the hamas started this, but israel may conclude that this is their clint eastwood make my day

moment. what they would do is then go in with tanks, with air and go in and destroy those missile batteries. why would they want to do that? two reasons, one so they'd stop going into israel right knew and also because if israel is contemplating any kind of a preemptive military strike against iran's nuclear forces what they would do is by taking out those missile batteries in the gaza strip means that iran high school a difficult time retaliating against israel. one of iran's retaliation moves would be to have those missiles, and if those missiles are gone it gives israel a lot more option. bill: here is the second scenario, this is the map one. i want to advance it one and take you into egypt and understand what is happening now in places like the sinai peninsula, over here and also from cairo as well. now, there is big concern about the current egyptian government taking the side of hamas. >> yes. bill: publicly they a pier have tappear to have done that.

we were told last year, be careful what they say in public compared to what they say in private. what concerns you with the current administration of egypt now. >> three things, one the border you just pointed to between gaza and egypt, that's been sealed. will the egyptians open that? and if they do then they allow military equipment, supplies to go frome from go from from egypt. the second thing i worry about is the demilitarized zone. that sinai peninsula is egyptian territory but there has been nobody there. it's a big desert. we've seen in the past year in a al-qaida has shet up shop and gone through and attacked israeli out po*es on the sinai-israeli border. the second thing i watch is what is going to happen with sinai,

is it going to be a militarized zone instead of a demilitarized zone. bill: let's bring in the issue of libya and how that has changed over the past year and a half. here is tripoli, this would be about benghazi, and there are reports, kt, that some of the military weapons used in this war here in libya are coming in to egypt and then going to that town of rafa that i wanted out that would then enter into gaza. can we say whether that's the case now, or is that just the concern now? >> no, it's probably the case now. why? when we had a libyan war there were a lot of unaccounted for weapons that gadhafi had in his stockpile that we never reclaimed. there are shoulder fired missiles, small arms, medium arms. are they making that route which is al-qaida controlled, through egypt, across the border and into the gaza strip that would then threaten israel not with

just some missiles but heavy duty weapons. bill: thank you, kt we appreciate your expertise. these are some decisions that people like benjamin netanyahu are going through right now to figure out whether or not a ground war in gaza happens or not. kt, thank you. martha: there is a stake out now at the visitor's center at the senate side of capitol hill beuse we are waiting for former cia director david petraeus to come out he has been taking questions on the deadly u.s. consulate attack in libya. lawmakers want to know what really happened the night that four americans were murdered. eat good fats. avoid bad. don't go over 2000... 1200 calories a day. carbs are bad. carbs are good. the story keeps changing. so i'm not listening... to anyone but myself. i know better nutrition when i see it: great grains. great grains cereal starts whole and stays whole. see the seam? more processed flakes look nothing like naturalrains. you can't argue with nutrition you can see. great grains. search great grains and see for yourself. for multi grain flakes tt are anxcellent source of fiber

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martha: former cia director david petraeus meeting with leaders in the senate right now. we are waiting for that meeting to wrap-up. the general also meeting with house intel members this morning about the attacks in libya. >> his comments basically were, he was very sorry that this incident occurred, and that anything that occurred with respect to his personal

situation had nothing to do with the way he handled benghazi at all, and he also clarified this. because this was out there too, that his resignation was because he didn't want to testify, clearly that was not the case. martha: george tuwiver is former attorney general. and we have house security counsel. general petraeus said there was no other reason for his resignation other than what has happened in his personal life. do you believe that? does any of this raise red flags for you? >> i think in terms of the relationship to benghazi, we have to take him at his word. he's got an incredible history of service, and exercise of careful responsibility that he's been entrusted with, so i believe that. what i find hard to accept, and i think an explanation that is not going to fly is the attorney

general and the justice department's explanation that they elected not to tell the president about this at the time that they learned that a senior national security official in the administration could be compromised, or at least his effectiveness in the job could be compromised. it's the job of the president, the dni, the national security adviser and the white house counsel to decide whether there's national security implications, not the justice department to act as a filter. martha: very interesting. mike, because eric holder has basically said the reason it didn't go higher or on to the white house this information is because we determined that there was no breach of national security in the emails annex changes between general petraeus and his biographer. what do you think? >> i think george is absolutely right on this. the fact of the matter is one of the reasons we do security investigations, against people, including myself and many other people who have top secret and additional clearances, like the director of the cia would is because you can't have anything

that you could be blackmailed w. those are the kind of things that they are looking for. have you done anything that somebody could potentially blackmail you with? that's the heart of the investigation part. its not that there had been a compromise of national security it's that there might be a risk of somebody in the future compromising positions because they knew some kind of information about them. martha: when you look at what came out of the meetings this morning, general petraeus is saying that the talking points that left the cia is different from what they ended up hearing coming from susan rice. why would that be? >> you know, it would require a lot of speculation to go into that. i mean, clearly one can aeu zoom that everything the cia was doing in libya, in benge specificallin benghazi specifically should not necessarily be available for public discussion. i recall that ambassador rice has said she was speaking from the best intelligence, but now that's described as unclassified

information. i would assume that our best intelligence is not unclassified information. so she may have been put in a very difficult position, and i think it's legitimate to ask by whom and why. martha: you have very big concerns about that as well, mike, who changed or twisted as you say the words that were from the intel talking points and they were interpreted very differently. >> sure, i mean clearly somebody sat around with a word document or either red lined it or changed the words on the computer to reflect what it was that the administration wanted to say. it was a small group of people that were doing that. in evidence of that really frankly you have the fact that secretary of state hillary clinton did not go in front of five microphones on a sunday talk show. not trying to be partisan here. she high school a storied career in decades and i don't think she would have ever gone on five sunday talk shows unless she knew there was something she didn't want to be on the record having said. i certainly think there is more here and i hope the investigation continues.

we ned to get to the bottom as to who it was who altered the words. martha: it remains to be seen why we didn't hear from the people central to the issue who had the information on it and why you would put someone out there who did in the know all the details and put them in that position in the first place. thank you very much. bill: breaking news out of wisconsin as it relates to obamacare. we'll bring that to you in a moment. the meeting has begun on the fiscal cliff in the white house. we should see the leading members of congress talk at some point very soon in front of that mike cone. when that happens we'll bring it to you. a quick break here we'll let you know what is happening in wisconsin and governor scott walker after this.

martha: fox news alert now on breaking news coming from wisconsin. governor scott walker says that

the state will not set up a health insurance exchange under obamacare as the states have been instructed to do. walker has now told the obama administration as of today that wisconsin will throw up its hands, basically and leave that responsibility of organizing those exchanges to the federal government. his decision really not unexpected given his long opposition to this law. he stopped implementation last year on the hopes that the law would be overturned either by the u.s. supreme court or by republicans following the november election, but that was not to be, so now scott walker says that he will not take any responsibility for that. that will go back to the federal government. bill: sandy was so devastating as we know. we are learning that houses of war sheurp eve worship are struggling to help themselvesment lauren green is live. what did you find out. >> houses of worships are supposed to be sanctuaries for the broken hearted. countless are in great need of

healing themselves. the repair work has done in bay head, new jersey but the road ahead is hrofpblgt the historic structure was built in the late 1800s and designed by boat builders but was never meant to withstand the urge of dirty bay water that sandy brought. >> this building will be closed for at least a year. we would like to think we will be back in 2013. that would be wonderful. we have to move our worshiping center to our sister church in phroeupbt pleasant, whic point pleasant, much further from the ocean and built on higher ground. >> rabbi marjorie sloan surveyed the damage, the storm put the entire temple under four feet of water. it has now buckling wooden floors. the holy books now mold-reupbd

are unusable but because of their religious content cannot be burned so they sit outdoors awaiting their fate. >> in judaism we don't toss things away. we have to take our prayer books and give them a proper burial. that's how we show they are sacred and not just tossed aside. >> many houses of worship across the northeast are in the same situation having lost treasures that cannot be replaced. the con tkpwra grant con congratulations will likely have to raise the money for repairs. martha: there are high stakes negotiations underway right now overt fiscal future of our nation. will president obama and house speaker john boehner be able to get close to some court of agreement on taxes and spending, or will the u.s. economy go over, oh, boy, that so-called fiscal cliff?

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bill: before we go here fox files exclusive heirs this weekend where we bring you inside north korea and a rare look as to what is known, a rare look at the underground railroad. >> it's a network of safe houses and secret groups. >> there are contacts along this entire route to help and aid north korea. >> some within your network, some within another network that is willing to help. you know people in those cities that are willing to risk housing for the north koreans. >> mike founded crossing borders a christian organization devoted to helping north korean refugees. this man whom we will call tom is currently the organization's director. >> why are you in disguise? >> i help north korean people in china it's illegal for anyone to even feed a north korean refugee. >> if your identity was revealed -- >> i could go to jail. >> or